Oil is lower, around $77.45, reversing gains from yesterday
The API forecasts an inventory draw of 2.5 MMBbls and a 2 MMBbl draw from Cushing
The Federal Reserve will meet today to discuss policy changes but is expected to keep interest rates unchanged
The number of tankers in the Red Sea has fallen sharply (BBG)
Following the attack on a tanker transporting Russian naphtha last week, tanker shipments through the Gulf of Aden have fallen, with about 100 ships now taking the longer route around Africa
Some of the drop may be due to ships turning off their tracking signals in an attempt to avoid being targeted
India leads global refining capacity increase (BBG)
Oil refining capacity in India is set to grow by 20% over the next five years as the country expands its refining sector
The IEA estimates that India will add 1 MMBbl/d of capacity through 2028, while China will be increasing capacity by 8% over the same period
Vitol said, “Expansions continue to be based in the areas where demand is growing” and that “expansions in the West are non-existent”
Natural gas prices trade higher, supported by daily production declines and a mixed-weather outlook
March ’24 Henry Hub is up 5.7c this morning to trade around $2.134/MMBtu
The Summer ’24 strip is up 4.2c to $2.475, and the Winter ‘24/’25 strip is up 4.3c to $3.488
A P66/DCP-owned natural gas pipeline ruptured in Oklahoma's Beaver County, impacting an area with three gas plants totaling 160 Mmcf/d capacity (Reuters, Criterion)
We haven't seen any basis price movement for the pipelines in proximity to the affected area
Additionally, the House Subcommittee is scheduled to hold a hearing on the LNG export ban on February 6
Today's Euro Ens shows Midwest/South Central cooling while Northeast and Rockies/West warmed, with above-normal temperatures expected into mid-February
Lower 48 gas production fell by 0.95 Bcf/d to 102.9 Bcf/d, with no significant recovery today, further dropping to 102.8 Bcf/d (Criterion)
Haynesville saw a notable decrease of 0.26 Bcf/d to 15.86 Bcf/d today, with a total decline of 0.46 Bcf/d since last Friday across Gulf South, Gulf Run, ETC Tiger, and NGPL pipelines
Gas-fired power capacity growth challenges net zero emission goals (Global data)
Nearly 134 GW of gas-fired power capacity is currently under construction worldwide, similar to the volume built in the last five years (153 GW), with an additional 416 GW in the global pipeline
In Asia-Pacific, Europe, the Middle East, and Africa, the gas-fired capacity under construction now is 67 GW, 18 GW, and 27 GW, respectively, surpassing the volume built in the last five years
This boom starkly contrasts with the IEA’s Net Zero Emissions Scenario, which forecasts a nearly 20% decline in gas demand by 2030 and about 80% by 2050
However, not all of the planned 416 GW of gas-fired plants may not be built due to the growing economic viability of renewables and the steady rate of gas-fired capacity retiring and renewable additions balancing the electricity mix
Dominion's Virginia wind project gets green light for 2.6 GW capacity (Criterion)
Dominion Energy receives final regulatory approvals for the 2.6 GW Coastal Virginia Offshore Wind project from the U.S. Bureau of Ocean Energy Management and Army Corps of Engineers
The project includes 176 offshore wind turbines and three substations spread over 113,000 acres off Virginia Beach, aiming for completion by late 2026
Onshore construction commenced in November 2023 and is set to ramp up following the recent approvals
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